Chalet Hotels Ltd

NSE:CHALET

Earnings Call Transcript 2022-Q1

[Operator]

Ladies and gentlemen, good day, and welcome to the Q1 FY '22 Earnings Conference Call of Chalet Hotels Limited. [Operator Instructions] Please note that this conference is being recorded.I now hand the conference over to Ms. Ruchi Rudra. Thank you, and over to you, ma'am.

[Ruchi Rudra]

Good morning, ladies and gentlemen. Welcome to the first quarter financial year 2022 performance call for Chalet Hotels Limited. We have with us Mr. Sanjay Sethi, the Managing Director and CEO; and Mr. Milind Wadekar, our CFO, to take you through the performance and respond to your queries.Let me make the usual disclaimer on forward-looking statements and rounding off of numbers. Kindly refer to our presentation, which has been made available on the stock exchanges and on our website for the details of the same.I now hand over the line to Mr. Sethi to share his opening remarks.

[Sanjay Sethi, MD, CEO & Director]

Thank you, Ruchi. Good morning, everyone. I trust all of you are safe and doing well. As you're aware, the second wave struck the nation and impacted businesses in Q1 of this year. The restrictions brought many cities to a standstill, and hospitality business was hit hard. On a positive side, we have seen a flattening of the curve in June, reflecting well on the business.At the onset of the second wave in March '21, the state of Maharashtra imposed full lockdown from 4th of April until 7th of June, literally impacting 2/3 of the quarter. Similar lockdowns were witnessed in Maharashtra and Telangana also -- sorry, in Karnataka and Telangana also. There has been a phased opening in these states. Hyderabad has opened up a lot quicker. Maharashtra has been slow to open up, and F&B is still restricted until 4:00 p.m. in Maharashtra. Now the good news. The month of June and July saw improving consumer sentiments with sharp pickup in business and leisure segments. We see a similar trend for the month of August. The ramp-up in occupancies was stronger post the second wave as compared to the first wave, indicative of resilience of travel and confidence of the travelers.U.S. has 50% and U.K. 58% of its total population vaccinated. Both are key source geographies for Chalet. The European Union, Middle East and several other geographies have opened their countries for tourism for fully vaccinated travelers under the Vaccine Passport initiative. Some of the top global companies have announced back-to-work plan, and several of them have also announced reopening dates.For our overall portfolio, April occupancies were 36%. May had a steep drop to a 23% occupancies. However, June saw a smart recovery at 47% occupancies. The month of July continued to follow the trend with portfolio occupancies at 54%. The month of July has actually recorded the highest revenue occupancy and RevPAR since the pandemic started. Business continues to come from the segments of Bollywood shoots, IPL, sea farers and social functions, and now banking, financial services and project-related businesses have shown strong shoots of recovery.The restrictions on dine-in services and banquet impacted the performance of food and beverage. Contribution from F&B segment was INR 131 million for Q1 against INR 273 million for the previous quarter.On the P&L front, in Q1, we received a rebate from one of our operators on the past disputed liability of INR 37 million on reimbursement. Excluding this, the revenue for the quarter was INR 715 million, higher 21% year-on-year. Milind will take you through some of the details later.Our cost-control measures since the beginning of the pandemic kept the fixed cost 46% lower as compared to the pre-COVID comparable of Q1 FY '20. For the hospitality division, variable costs are in line with revenue levels and were down by around 70% for the quarter.Our staff-to-room ratio, a key metric for hospitality, further improved to 0.7 as of June '21 from 0.74 as of March '21 on improved efficiencies at our hotels. We report all employees, including those on contract and outsourced services, for this calculation. Utility cost at absolute level was down by 11% sequentially for hospitality in Q1 '22, while maintaining the unit consumption efficiency on a per-room basis.Reported EBITDA for the quarter was negative INR 31 million. This, however, includes a onetime charge of INR 94 million for interest payable on cancellation of -- to 6 flat owners who have decided not to continue with the Koramangala project. As you know, these cancellations are funded by the promoters on the cash flow front, and we can elaborate this further in the Q&A session.Adjusted for this and the rebate from our operator, the EBITDA for the quarter was INR 25 million as against INR 51 million reported in the preceding quarter. On the nonhotel assets, rentals from our commercial tenants were stable for the quarter. We have, as I've mentioned earlier, given some relief on CAM and parking area charges that continues for this quarter also.The Inorbit Mall in Bengaluru was closed for the months of May and June because of the restrictions in the city, impacting the mall's performance. The repurposing of the space at The Orb at Sahar, Mumbai is underway with majority of the area being converted into commercial offices. Select F&B outlets will continue to operate, providing the necessary F&B to the office occupants. On the growth pipeline, 2 commercial development projects are progressing well and in line with the timeline shared in our previous call. We continue to evaluate demand dynamics to assess the opening of the new hotel in Hyderabad, expansion of capacity in Pune and the rebranding of the Powai Hotel. Our mission to go green as a company is gathering further momentum. Since our last update on EV100, which focuses on accelerating transition to electric vehicles, we are now committing to EP100 on the energy productivity and RE100 on renewable energy. Our applications have been submitted and are under consideration with the Climate Group.I would also like to update you that we have started the process of application for the Dow Jones Sustainability Index, or DJSI, as it's known, ranking on ESG parameters.I'm also very happy to share that Chalet received the 6th rank in Great Places to Work in mid-segment companies in India. This is 10 notches higher than the previous ranking last year. In addition, Chalet Hotels has also been ranked 40th in the Best Places to Work in Asia in a similar category. These recognitions reinforce the power of strong human resource practices at Chalet Hotels.Ladies and gentlemen, whilst we have had a longish rough patch, the strategic mix of asset classes in our portfolio has and will hold us well in the coming years. Chalet also has significant value that can be unlocked from its existing balance sheet, and we look forward to discussing the same in the future -- in the near future.Now please do join me in congratulating Milind, who has been promoted to the position of CFO of Chalet Hotels, and I hand over the proceedings to Milind now to take you through some of the key financials. Milind?

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

Thank you, Sanjay. Good morning, ladies and gentlemen. The first quarter of this year started in the midst of second wave with resurfacing of lockdowns, and our performance reflect the same.Reported revenue for the quarter was INR 753 million, which includes a rebate received from operating partner of INR 37 million for past distributed liabilities. Adjusted for this, the revenue was at INR 715 million for the quarter, which was sequentially down by 30%. EBITDA for the quarter was negative INR 31 million, which additionally included INR 94 million on account of interest on cancellation of 6 flats in Koramangala. Adjusting for these rebates, EBITDA for Q1 was positive of INR 25 million.PBT post charges on depreciation and interest for the company was negative of INR 638 million as against negative of INR 475 million in the sequential quarter of Q4. After taking credit for deferred tax asset of INR 275 million, loss after tax was at INR 363 million.The hospitality segment contributed to 66% of the total revenue of the company in Q1 FY '21. Occupancy for the quarter averaged at 36%, lower by 3 percentage points sequentially, largely due to a drop in occupancy in the month of May. The RevPAR for the same period was at INR 1,252 against INR 1,610. On a year-on-year comparison, occupancy is up 12 percentage points, and the RevPAR is up 35%. Adjusted for the rebate, the revenue for hospitality was INR 462 million in the quarter as against INR 724 million in Q4 and INR 312 million in Q1 of last year. EBITDA loss adjusted for rebate was at INR 99 million against profit of INR 19 million in Q4 and a loss of INR 145 million in Q1 of the previous year.On the cost front, we continued to maintain lower fixed and variable costs compared to our pre-COVID performance. Fixed cost was lower by approximately 46%, and variable costs were lower by 70% as compared to pre-COVID Q1 of FY '20. The variable costs are expected to rationalize as operations scale up, whereas our strategic initiatives on cost will keep the variable cost contribution lower than traditional levels.On retail and commercial front, we have received steady rental income from commercial assets, and the revenue and EBITDA from retail and commercial segment was at INR 233 million and INR 191 million for the quarter, respectively. As mentioned by Sanjay, Inorbit Mall at Bengaluru was closed due to lockdown for 2 months, and we are currently in the process of repurposing The Orb at Sahar. We expect the contribution from retail -- sorry, and hence, the contribution from retail operations have been lower for the quarter. With the conversion of large part of The Orb at Sahar to commercial office space, we'll be hedging the portfolio further. The new setup is likely to be EBITDA and return ratios accretive.Net debt of the company as on 30th June was at INR 1,953 crores as against INR 1,871 crores, a total increase of around INR 83 crores in the period. The CapEx spent during the same period was INR 34 crores. Our cash burn, that is, EBITDA less finance cost, for Q1 FY '21 has been INR 39 crores led by prudent cash flows and working capital management. The average cost of rupee loan is now at 7.92% as against 8.04% at the beginning of the year. The cost of all loans is in the range of 8%.We have cash and cash equivalent as of June '21 of INR 77 crores and INR 780 crores available lines of credit for general corporate purpose and planned CapEx. There has been no new subscription from promoters on 0% nonconvertible redeemable preferentials for funding the outflow relating to residential project at Koramangala during the period under review.Since we have recommenced negotiations with the flat owners for new plan, a majority of existing owners barring 9 have consented to continue with the project. Of these, 6 customers have exited from the project and payments have been made, while the remaining 3 customers have expressed their desire to exit. However, final exit documents are awaited. We are awaiting final clearances from regulatory authorities and court to recommence work at site. A suitable announcement will be made for the same once the approvals are in place.With this, we'll now open the floor to questions.

[Operator]

[Operator Instructions] The first question is from the line of Aditya Bagul from Axis Capital.

[Aditya Bagul, Assistant Vice President of Midcaps]

Congratulations to the entire team at Chalet for a reasonable performance amid really challenging times, and congratulations, Milind sir, on the promotion.Sir, 3 questions. Firstly, Sanjay, if you can help me understand a little more in terms of a texture of our occupancy. You did allude to improvements across the board in our customer set, but if you can give us a little more texture in terms of how do you see the corporate shaping up over the next 3 to 4 months. And if you've got any learnings from our Marriott and other brand partners from how international travel is likely to play out over the next 6 to 12 months, that would be helpful. That's my question number one.My question number two is, essentially, in terms of our employee-to-room ratio, we've done a spectacular job there, but assuming that we were to go back to, let's say, 70% occupancy, what would be a steady-state number there?I also have a third question, but I'll come back.

[Sanjay Sethi, MD, CEO & Director]

Thank you, Aditya, and it's always a pleasure to speak with you. But overall, the state of travel is still in a state of flux and, therefore, a lot of the business that we're getting right now is business that has been created out of opportunities in the current environment. The good part is that we've been able to capitalize on those opportunities well and have been able to report high occupancies.To answer your question specifically on the business travel, I think everyone here on this call will know that that's still nowhere near normalcy right now. And if you were to open up or look at the DGCA site on passenger loads on aircraft, you'll realize that we are still at about 30% of the same period 2019 numbers, and that's not a great sign. But what we are looking at is the pace of future bookings. Second, we are looking at what's happening in various companies and industries. On the industries front, we see hiring patterns to be encouraging. On the companies front, as I mentioned earlier, we see announcements of back-to-work happening.And finally, on the health front, the vaccination that's happening on the ground in India and elsewhere in the world is encouraging. Today, India has 400 million people who received the first dose, 113 million and a little over that who received the second dose. And with approximately 5.5 million to 6 million people getting vaccinated every day, this should ramp up fairly quickly, and we are still awaiting the final on-ground execution of the new vaccines. The moment those 3 or 4 new vaccines come into play, this ramp -- this vaccination pace should at least double.Overall, our view is that the domestic business travel will be back in quarter 3 to at least 50% to 60% of pre-COVID numbers. International travel, however, will probably have a lag of a couple of quarters after that. Currently, roughly around 15% to 20% -- or maybe 20% to 25% of our business comes from business travel because -- and I'm saying this from the numbers that I see here, that 15% of the in-house residents in Q1 for us were foreigners. Clearly, they are not here for leisure travel. So they are here for work.So if we have 15% coming out of foreigners, you can add another 10% to 12% from domestic business travelers. Roughly between 25% to 30% of the room nights that we've done are coming now from business travel. If you -- and I've taken a few flights in the recent weeks. My colleagues have done that. We are now, for the first time, seeing, on the aircraft, very obvious business travelers on the aircraft, which indicates business travel is back.Finally, I think the -- there were 2 points of our business travel. One was, the companies were not ready to take the risk, but then companies were not ready to even call them back to work. Back-to-work is happening. Travel, the one bottleneck was the scare about breathing common air on an aircraft. I think the airline industry has done a fabulous job of making people comfortable that they have it all under control. So that fear is largely out of people's mind. Rooms, in any case, were never the problem because the air conditioning in rooms in hotels is individual. There's no cross-transfer of the air from one room to the other. So with all that in place and largely the WHO recommendation that the transmission through surfaces is almost negligible has given a lot of comfort for people to travel. And if people can travel in large volumes for leisure, when the need for business travel arises, there's no reason why they won't travel for business, too.Coming to your second question, employee-to-room ratio on a steady count, we believe that when we hit back that 75% occupancy that Chalet was at in the pre-COVID period, we should be back to -- at the highest of 0.9 employees to a room. As a reference, we were 1.22 when we listed the company. We had come down to a little over 1.1 prepandemic. Our target that time was 1 employee to a room. Our fresh target on a normalized basis is 0.9 employees to a room. And when I say 0.9, I want to emphasize, this includes contract employees, fixed-term contracts, outsourced employees, all of them. This is not just permanent employees in our rooms.

[Aditya Bagul, Assistant Vice President of Midcaps]

Great. Sanjay, I think that is a commendable job in terms of efficiency that we've done, not only in terms of our employees but also in terms of our fixed cost.The last question that I had was on our Koramangala project. I mean this has been in limbo ever seen our IPO. I just wanted to get a status update. How do we see the pickup in that project? Any timelines that you would like to share? Or at the time of the IPO, there were various discussions that we did in terms of what kind of eventual NPV Chalet could realize. If there are any indications that you can share, that would be very helpful.

[Sanjay Sethi, MD, CEO & Director]

Look, Aditya, I can't give you information that is unannounced in the public domain as of now, but what I can share with you is the progress on the Koramangala side. There were 3 or 4 hurdles to this Koramangala project. One was that HAL had withdrawn its approval. Second was because of that, we were not getting the approvals to build. Third was, if we went with 10 stories only, there were a certain number of buyers who were above the 10th floor, who we needed to move to the lower floors. So let me take you through one by one what has happened till now. The fire NOC has been received. The 92 flat owners that were there, and I think Milind touched on it a little earlier, out of the 92 flat owners, 83 have confirmed that they will continue, and out of those 83 who were on higher floors have accepted the floors below the 10th level or at 10th and below level and signed MOUs with us. This has allowed us now to go to the courts and HAL, that we have an agreement between the buyers and us to cap this project at 10 stories, and we have presented a draft compromise document to HAL. It has gone through 2 stages of approval at their end, and the final committee meeting is expected in the near future. Once that comes through, the process is very simple. We take it to court, and we say that both parties have agreed to these -- what's in the document there, and we apply then for the final approval for -- to BBMP. The HAL draft approval and the subsequent submissions to the court is imminent now. I can't give you a specific timelines because there's a third party involved, which has to deliver the next step, but it is not months anymore. It's probably weeks or days now.Second part of your question was around the financials. The financials hold well. Milind will now give you some number in terms of what is the project size, and then you can extrapolate that in your workings if you want.

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

Aditya, we cannot give you NPV. It depends on many variables, but we would like to give you some data points. Now this is going to be a 12-building project, up to 10 floors, 2 buildings with 11 floors, and total area of around 8.5 lakhs. Out of 8.5 lakhs, 2.8 lakh square feet is sold to existing -- I mean, the flat owners who are there, 83 flat owners. So balanced sellable area is around 5.7 lakh square feet.The rate in that area is around 12,500. We are planning to put 1.5 lakh square feet commercial project for strata sale. We'll build it and sell it. And the cost estimated to complete this project, including commercial, will be in the range of INR 425 crores to INR 450 crores.

[Sanjay Sethi, MD, CEO & Director]

Just to repeat, it's INR 425 crores to INR 450 crores for cost to complete the project. And roughly, I think you might want to give the number of apartments that are still pending to be sold.

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

230 apartments to be sold. So we have total 321 apartments. 83 are sold. And balance -- 238, sorry. Not 230, 238 apartments.

[Sanjay Sethi, MD, CEO & Director]

Aditya, let me close this by the final comment that this is certainly going to be a value-accretive project. And as I said in my opening statement also, Chalet has opportunities on its own balance sheet, which can be unlocked to create significant value for the years ahead. This is one of those, and there are some more which we can talk about later. Thank you, Aditya.

[Operator]

[Operator Instructions] The next question is from the line of Vikas Ahuja from Antique Stockbroking.

[Vikas Ahuja, Research Analyst]

I have a couple of questions. Number one, in the presentation, you highlighted that post second wave in the month of June, the occupancy jumped to 47%, and it's more than 50% in July and maybe in early August. Do we think that 50-plus occupancy level will gradually improve, provided there is no third wave? And also, how was the ADR overall in June and July versus maybe INR 3,500 for the whole quarter Q1?

[Sanjay Sethi, MD, CEO & Director]

So thank you, Vikas. Yes, you're right in assessment that the occupancies are now reaching sort of a steady-state situation. The third wave is -- your guess is as good as mine. I won't hazard against right now on that one. I think we are, as a nation, better prepared for it if it does come by. Mumbai, as you know, and Maharashtra as a whole has been extremely cautious on the opening up on account of the anticipated third wave. And even if it comes, I'm saying, it's a matter of 1 or 2 months now for even that to come and go. So I don't see a mid- or long-term impact of COVID post that. I think we'll be able to retain occupants. I think it's important to also note that the ramp-up post the second wave has been a lot sharper than the ramp-up post the first wave. That's one.On your question on the average room rate, because I did say that when I answered the earlier question, that we have been -- I think our teams have been extremely efficient in picking up the special-purpose businesses, group businesses that were available in the market, and the occupancies in some of our hotels have now hit pretty high numbers. I mean if you were to look at individual hotel occupancies in the recent months, there are at least now 2 or 3 hotels which are now exceeding 50% by a big margin. I don't want to say anything more than that because we haven't given that as an open disclosure elsewhere. But -- especially for July and August.The ADRs have, obviously, been muted as a result. They are hovering around the INR 3,800, INR 4,000 mark, but the RevPARs are now comfortably over INR 2,000, and they've been -- in July, when we crossed over roughly around INR 2,100 RevPAR, it was the highest we've had since March of last -- of 2020. August as of now is actually better than July.

[Vikas Ahuja, Research Analyst]

And secondly, on the staff-to-room ratio, which has come down to 0.7, and you just told us that it may go up to 0.9, that is more of a normalized number. But are we also working on the pyramid, like, by hiring more freshers or less experienced people to reduce the overall employee cost?

[Sanjay Sethi, MD, CEO & Director]

So to answer your question, right now, there's not too much of hiring happening. It's very few. It's a handful of numbers that we have hired in the last 3 months. But as we go down to ramp up our numbers, when the business demands require to, clearly, we'll be looking at a younger, more contemporary workforce in Chalet, which is -- the values are aligned with current times and the Chalet's values.

[Vikas Ahuja, Research Analyst]

Sure. So overall, the -- in terms of savings would be much better than the...

[Sanjay Sethi, MD, CEO & Director]

Cost to company will be lower.

[Vikas Ahuja, Research Analyst]

Yes. Okay. Okay. Sure. And also, I know you have answered this earlier to Aditya, but just want to come back to corporate side bookings again. Any early feedback you are getting from them in terms of the pricing or the contract? Because clearly, many of the corporates are now guiding for travel expenses coming back gradually from second half because many of the sales guys will start traveling. And you have highlighted that hiring has been very, very strong in most of the sectors, especially IT and consulting. I mean any kind of a feedback you can provide us when you're talking to those customers? How they are looking at it in terms of pricing? Are they asking for a huge discount right now, just trying to capitalize on the situation? Yes, I think any of the feedbacks?And last question is for Milind. Milind, if you can just help us with any kind of a guidance on debt for FY '22, '23? How [ is it going to move ]?

[Sanjay Sethi, MD, CEO & Director]

So Vikas, clearly, the rates are muted right now. And even if there's a corporate rate, which has been accepted and signed off by a corporate traveler and if your rates online are lower, they'll take advantage of that. So right now, there's no resistance to rate contracts because rate contracts have this clause that they can choose the rate contract or our, what we call, the best available rate for that day on our website. They have the option of doing both.So therefore, the rates -- we haven't seen any specific guidelines from our clients. Corporate, whilst we -- as I said, 15% of our guests in the last quarter were foreigners, we haven't really had new RFPs signed with foreign companies because they still haven't firmed up their dates of travel. And the big factor there is that India has really not announced opening up of visas as yet. So people around the world are not really able to plan travel because India hasn't opened up travel for regular business or leisure tourists from -- inbound from all of the -- from other countries as yet. Once India announces that, we will then see a significant traction on foreign business travel. This is something that we've been following up with the government, that even if you can't do it immediately, why don't you announce an advanced date like U.K. did? And it worked brilliantly for U.K., actually.And so let's see. If that happens, it will definitely be helpful. But no resistance on the rate purely because, today, your best available rates online are very reasonable, so people are opting for that rate. One more data point on foreign travel. In Q4 last year to Q1 this year, the growth on foreign guests in our hotels is up by 61%.

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

So Vikas, on debt front, today, we are at INR 1,950 crores, and our debt will peak at around INR 2,500 crores in FY '23. And we have planned CapEx of around INR 850 crores spread over the next 2.5 years. Out of INR 850 crores, a major part is for commercial of around INR 650 crores, and INR 200 crores is for hotels. Again, hotel CapEx will depend on micro market conditions of the respective hotel, Pune and Hyderabad.So from INR 1,900 to INR 2,500 in FY '23. And FY '22 will depend on the CapEx which we incur in the balance part of the year.

[Sanjay Sethi, MD, CEO & Director]

May I just add to that? It is very important to look at what our debt profile is. You've got to actually divide that into growth capital-driven debt and regular non-growth capital-driven debt, and you will find the majority of the debt on our books is actually growth driven. And that's an important factor for all of us to sort of recognize, which will then start being -- getting monetized over the next few months to the next 3 years now.So the ramp-up on openings of the 2 office buildings, the third hotel, the expansion in Pune, the rebranding of the Powai Hotel and certain -- and Koramangala, for example, all of this will show very sharp return. Koramangala, as you realize, it's largely going to be funded through sales. So that may not have any significant impact, except initial 1 or 2 months on the debt side, and that will be very small [indiscernible].

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

So Aditya, we don't want to give forward-looking numbers, but if you look at our operating cash burn for the current quarter, which is around INR 38 crores, INR 39 crores, as occupancies pick up and we have a steady income from -- income and EBITDA from retail and commercial, we expect that operating cash burn will reduce on a quarter-on-quarter basis, and that will be reflected in our debt. I mean as Sanjay has mentioned, then whatever incremental debt will be only for growth.

[Sanjay Sethi, MD, CEO & Director]

May I just add to that? When Milind says operating cash burn, it's including interest cost. That's not at operating levels. EBITDA positive is a given. We are talking about post interest cost.

[Vikas Ahuja, Research Analyst]

Sure, sir. I was just trying to see if there's any deviation from guidance last quarter. This is very helpful.

[Sanjay Sethi, MD, CEO & Director]

They're actually very much on track. If anything, I think, we should be able to do better because numbers are looking better, and I think Koramangala is a big move forward for us.

[Operator]

[Operator Instructions] The next question is from the line of Karan Khanna from AMBIT Capital.

[Karan Khanna, Analyst]

Firstly, when you talk about the occupancy that was 54% in July, will it be fair to assume that this was largely driven by MMR? Or is it possible to get some flavor in terms of how -- what sort of occupancies and what sort of footfalls are you seeing in Bangalore and Hyderabad?And as a follow-up to this question, since June we have seen a sharper recovery across the leading hotel chains. Assuming there is no threat of another lockdown, is it fair to assume that the exit occupancies by end FY '22 should be similar to what it was before the pandemic started? And also, what is your take on ADR recovery because of this?

[Sanjay Sethi, MD, CEO & Director]

Karan, thank you. I'm sorry I missed the second part of the question. Could you just repeat that, please?

[Karan Khanna, Analyst]

Yes. I was saying that given that we've seen a fairly sharper recovery since June across hotel chains, assuming there is no threat of another lockdown, how should one think about the exit occupancies by end of FY '22? And resultantly, what's your take on the ADR recovery because of this?

[Sanjay Sethi, MD, CEO & Director]

So on the first part on your question about occupancies city wise and whether it's largely driven by MMR, yes, MMR had a larger impact than any other place on the overall growth, but Pune has done well. We see Hyderabad picking up pretty well. Bangalore has been a little bit of a challenge for us because the Whitefield-Sarjapur Outer Ring Road market is completely dry because IT/ITeS companies have really not moved -- are starting to work and not traveling for business too much. But that will open up soon. We are confident of that.So to give you a reference and if you are talking -- this is July occupancies, right? So Novotel was at 64%; Four Points Sheraton -- Novotel, Pune; Four Points Sheraton, 55%; JW Marriott, Sahar, 77%; Renaissance and MEA, that is, Marriott Executive Apartments, combined together, 53%; Westin had started climbing up rapidly in July at 46%; Bangalore, still struggled at 28%.So besides Bangalore, which actually dragged the blended occupancy down, almost everyone is climbing up fairly well. We are very happy with the performance of occupancies at JW Sahar, Four Points and Novotel and Marriott Executive Apartments, which is in the 70s.

[Karan Khanna, Analyst]

Sure. Sure. And the second question on how should one think about the exit occupancies in FY '22?

[Sanjay Sethi, MD, CEO & Director]

Karan, I'm afraid I'm not going to be able to give you forward-looking numbers on that.

[Karan Khanna, Analyst]

Okay. Sure. No worries. Secondly, on your retail portfolio, you've been looking to restrategize the Inorbit Mall. Can you help us understand how has the recovery been here since the opening post the COVID second wave? And what kind of rental waivers have you offered to your retail tenants?

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

So post first wave, I mean, opening, the footfalls increased, and we could recover the cost. And last 2 months, Inorbit Bangalore mall is almost closed, and retailers have been asking for waivers on CAM as well as on rentals. So we are negotiating on a case-to-case basis. But we have recovered the cost. I mean, we could break -- I mean there was a loss of around INR 3 million at EBITDA level.

[Sanjay Sethi, MD, CEO & Director]

That is for the quarter.

[Milind Wadekar, VP of Finance & Tax and Interim CFO]

For the quarter.

[Sanjay Sethi, MD, CEO & Director]

But I think July would be maybe slightly better. We don't have the numbers handy right now to give you that, and we will come back to you if there's any further information. But just finally, Karan, to just answer, Inorbit Bangalore, I think there is an opportunity to sweat that asset in a different way. So maybe we need to skin that cat a little differently and get an optimized value creation out of that particular asset. So we are studying all opportunities. And the multiplexes are on hold. Cinemas are not allowed to open. With all of that in play, we've got to have a long-term view on this one. We are considering all options. We will come back to you when we have something concrete on that.

[Operator]

As there are no further questions, I would now like to hand the conference over to Mr. Sanjay Sethi for closing comments.

[Sanjay Sethi, MD, CEO & Director]

Thank you. Once again, thank you, everyone, for your time. We really appreciate the time that you spent on the call. We do hope you all stay well, and jointly, we look forward to better times ahead. Thank you.

[Operator]

Thank you. On behalf of Chalet Hotels Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.